Discussing recent events and what to watch before July month-end

This week George Goncalves, MUFG Head of U.S. Macro Strategy, reviews recent market, macro and political events in the US.  George and team have been focused on the lags of monetary policy, the lags in how long its been taking for sticky inflation to unwind and the data discrepancies in the true health of the US labor market. The latest CPI report showed a better than expected inflation reading, which was a welcome sign and consistent with our house view that the worst on the inflation front is probably over.  We would be remiss in not discussing the market’s reaction to the assassination attempt on Donald Trump. Thus far this incident has been met with risk-on in the marketplace with the curve steepening and a major sector rotation in stocks, now being dubbed “Trump Trades.” We caution that a lot may be priced-in to the curve right now. Lastly we cover what to watch for before July month-end with PCE and jobs data revisions our main focus before we speak again ahead of the FOMC.